Scottish Court of Session Decisions

James Gibson Son, Limited, incorporated under the Companies Acts 1862–1890, and having their registered office at Brunstane Mills, Musselburgh, raised in the Sheriff Court of the Lothians at Edinburgh an action against George Gibson, designed as “formerly manager for the pursuers, and residing at Wellington Place, Brunstane, Musselburgh, in which they prayed the Court summarily to eject the defender from the dwelling-house at Wellington Place foresaid.

The pursuers averred—“(Cond. 1) The pursuers are tenants of the subjects known as the Brunstane Mills, Musselburgh, with the houses and land attached thereto, situated in the parish of Duddingston and county of Edinburgh. (Cond. 2) The defender George Gibson was employed by the pursuers, and part of the emoluments for his services was the free use of the dwelling-house at Wellington Place aforesaid, now occupied by him, being part of the said subjects. (Cond. 3) The defender resigned his situation with the pursuers, and his resignation was accepted by the pursuers on 20th October 1898. His services

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with them terminated on 31st October 1898. On the termination of the defender's services with the pursuers, the defender was bound to evacuate the possession of said dwelling-house occupied by him as a servant of the pursuers, but he has refused to do so. The pursuers on 17th November 1898, while maintaining the sufficiency (which they heard the defender was likely to question) of the acceptance of Mr Gibson's resignation as terminating his employment with the company, dismissed him from the service of the company for misconduct. (Cond. 4) The defender's possession or occupation of the said dwelling-house is precarious, without any right or title, and without the consent of the pursuers. The defender has been required by the pursuers to remove therefrom, but he refuses or at least delays to do so, and this application has accordingly been rendered necessary.”

The pursuers pleaded—“(1) The defender having no right or title to possess the subjects libelled on presently occupied by him, the pursuers are entitled to have him ejected therefrom as craved. (2) The defender's service with the pursuers having terminated, decree should be pronounced as craved, with expenses.”

The defender averred that he was managing director of the pursuers' firm, and chairman of the company, and denied that he had resigned his situation or had been legally dismissed. He pleaded, inter alia—“(1) The pursuers' statements are irrelevant, and insufficient to support the conclusions of the petition.”

From the productions in the case it appeared that the defender held the position of chairman of the board of directors, and of managing director of the company.

On 19th January 1899 the Sheriff-Substitute ( Maconochie) pronounced the following interlocutor:—“Having considered the record and productions in the cause, sustains the first plea-in-law for the defender; dismisses the action.”

“ Note.—A decree of summary ejection of a person from his house is a serious matter, and is not one which, in my opinion, the Court should grant unless the pursuer has stated his case on record very clearly, and unless it is plain that the defender falls within one of the classes to which the process has been held to apply. The process is undoubtedly available against an employee whose occupancy of the house is incidental to his employment; if such a one refuses to vacate the house at the termination of his employment he is liable to be summarily ejected. The pursuers here, who are a limited company, ask the Court ‘summarily to eject’ George Gibson, ‘manager for the pursuers,’ from the house at Wellington Place occupied by him, and of which they are tenants. They aver that the defender ‘was employed by the pursuers, and part of the emoluments for his services was the free use of the dwelling-house’ in question. It will be observed that the pursuers do not say what the employment of the defender by them was, how it was constituted, for what services the house formed part of the emoluments, or how any contract there was was terminable. It appears, however, from the productions, and it was admitted by the pursuers at the debate, that the position which the defender held was that of a director of the company, and that he further held the positions of chairman of the board of directors and of managing director of the company. The designation of the defender in the petition is thus clearly a misnomer, and I think it is very doubtful whether the chairman of the directors and managing director can properly be termed an employee of the company. In any case, however, the nature of his position should have been set forth in the condescendence. The prayer of the petition is, however, rested on the ground that the defender was a servant of the company; and accordingly the pursuers go on to say (Cond. 3) ‘The defender resigned his situation with the pursuers, and his resignation was accepted on 20th October 1898. On the termination of the defender's services with the pursuers, the defender was bound to evacuate the possession of said dwelling-house occupied by him as a servant of the pursuers;’ and they further state that not only was his resignation accepted, but that on 17th November 1898 they ‘dismissed him from the service of the company for misconduct.’ Now, they do not state what ‘situation’ he resigned, whether that of ordinary director, chairman of the board, or managing director, nor in which capacity he occupied the house. Again, they do not say from which of these positions they dismissed the defender, assuming that they had power to dismiss him at all. These are all things which should have been stated, and yet they have been carefully omitted from the petition. There are evidently difficult legal questions raised in the case, and I do not think that the averments on record are relevant to entitle the pursuers to so drastic a decree as that of summary ejection.”

The pursuers appealed to the Sheriff ( Rutherfurd), who on 3rd February 1899 adhered.

“ Note.—The Sheriff agrees with the Sheriff-Substitute in thinking that the pursuers' averments are not sufficient to support the prayer of the petition. The pursuers no doubt allege that the defender is a precarious possessor of the dwelling-house referred to on record, ‘without any right or title, and without the consent of the pursuers;’ but questions of difficulty have arisen between the parties, both as to the defender's alleged resignation of office as managing director, and as to the pursuers' power to dismiss him in the manner in which they did, and it does not appear to the Sheriff that he can be regarded as being in possession of the house like a mere squatter, without any title at all, or that the questions which have arisen between him and the pursuers can be properly or conveniently disposed of in a process for summary ejection— Robb v. Brearton, 1895, 22 R. 885.”

The pursuers appealed, and argued—It

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was relevantly averred on record that the defender had resigned his office, and that he had been dismissed. Although he could not be removed as a director, yet he could be dismissed as manager of the company, and it was in that capacity that he had been dismissed. He had the use of the house as part of his emoluments as manager, and his title to the house at once came to an end when he was dismissed from the service of the company. The right of occupancy of a house as incidental to service was a different thing from a tenancy. It was a precarious title, and summary ejection was competent— Scott v. M'Murdo, Feb. 4, 1869, 6 S.L.R. 301, opinion of Lord Deas, 302; Whyte v. School Board of Haddington, July 9, 1874, 1 R. 1124; Dove Wilson's Sheriff Court Practice (4th ed.) 485.

Argued for defender—If the averments on record and the facts brought out in the productions were taken into account, it was plain that summary ejection was not a competent process in the present case. There must be a definite and specific allegation of a vicious or precarious title before an action of summary ejection could be held relevant— Hally v. Lang, June 26, 1867, 5 Macph. 951; Scottish Property Investment and Building Society v. Horne, May 31, 1881, 8 R. 737; Robb v. Brearton, July 11, 1895, 22 R. 885. There was no such allegation here. The pursuers could not dismiss the defender, who was the managing director of the company, and possessed the house as such. Directors were not entitled to remove a managing director before the expiry of his period of office— Imperial Hydropathic Hotel Co., Blackport v. Hampson, 1882, L.R., 23 Ch D 1. In view of the disputed legal questions raised in the action, summary ejection was neither a proper nor a competent remedy.